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Samsung Electronics will distribute about 40 trillion won ($26.6 billion) in bonuses to chip division employees this year after striking a tentative agreement with its labor union, according to Bloomberg. Using the proposed terms and analyst projections for 2026 operating profit, Bloomberg calculated the average payout at 513 million won, the equivalent of about $340,000. The total average compensation across Samsung was 158 million won in 2025, per a company filing.

The agreement, subject to a union ratification vote running May 22 through May 27, calls for Samsung to direct 10.5% of operating profit into stock bonuses along with a separate 1.5% cash component, according to Bloomberg. The program runs for 10 years, contingent on the company meeting profit thresholds. One-third of the stock award can be liquidated right away, with the rest parceled out in installments across the next two years, Bloomberg reported. The first payout is expected in early 2027.

Not all workers will fare equally. As an illustration, Reuters cited a union source estimating that someone in the memory chip unit earning an 80-million-won base salary could take home roughly 626 million won in total bonuses this year. By comparison, workers at SK Hynix stand to collect upward of 700 million won should their employer post annual profit of 250 trillion won, Reuters calculated. Unlike at Samsung, SK Hynix employees are not limited to stock payouts and may instead opt for cash, Reuters reported.

The deal ended a standoff that drew intervention from South Korea's president, prime minister, and labor minister. A strike that shut down chip production could have cost the economy as much as 1 trillion won daily, with losses potentially multiplying to 100 trillion won if in-progress semiconductor wafers were rendered unusable. Samsung's shipments account for nearly a quarter of all South Korean exports.

Workers had pushed for bonuses tied directly to operating results and the removal of a cap that had limited payouts to half of annual salary. The union's original demand was for a bonus pool equivalent to 15% of operating profit. The settled rate of 10.5% was enough, in JPMorgan's estimation, to push Samsung's total performance-linked compensation to about 12% of operating profit for the year, Reuters reported.

Samsung stock rose more than 6% on Thursday following the announcement, supported in part by strong results from Nvidia.

https://qz.com/samsung-chip-workers-bonus-ai-profits-052126

Samsung Electronics labor and management reached a tentative wage agreement just 1 hour and 30 minutes before a total strike. If this tentative agreement passes the union’s approval vote, it will avert the largest-scale strike in the company’s history.

Samsung Electronics labor and management signed the tentative 2026 wage agreement at the Gyeonggi Employment and Labor Office in Suwon, Gyeonggi Province, on the afternoon of the 20th

Regarding the key OPI (excess profit performance bonus), both sides agreed to maintain the existing payment method, including the upper limit. Instead, they will additionally pay a non-capped special management performance bonus for 10 years. From this year until three years later, the bonus will be paid if the semiconductor sector’s operating profit exceeds 200 trillion Korean won, and from 2029 to 2035, it will be paid upon achieving 100 trillion Korean won. The bonus will be paid in stock, not cash, with restrictions on sale. The funding source was agreed to be 10.5% of business performance selected through labor-management agreement.

Regarding the allocation ratio by business division, it was finalized as 4 (entire semiconductor division) to 6 (business divisions). However, since this would result in even loss-making divisions receiving performance bonuses worth hundreds of millions of Korean won, a penalty was agreed upon to pay only 60% of the common payment amount to loss-making divisions, which will take effect from 2027.

Following this agreement, Samsung Electronics’ union joint struggle headquarters announced through a struggle guideline for members that “the total strike from May 21 to June 7 will be postponed until further notice.” They also announced that a vote on the tentative agreement will be held from 2 p.m. on the 22nd to 10 a.m. on the 27th. The tentative agreement will only gain formal status if it passes the vote.

Following this agreement, Samsung Electronics’ union joint struggle headquarters announced through a struggle guideline for members that “the total strike from May 21 to June 7 will be postponed until further notice.” They also announced that a vote on the tentative agreement will be held from 2 p.m. on the 22nd to 10 a.m. on the 27th. The tentative agreement will only gain formal status if it passes the vote.

Following this agreement, Samsung Electronics’ union joint struggle headquarters announced through a struggle guideline for members that “the total strike from May 21 to June 7 will be postponed until further notice.” They also announced that a vote on the tentative agreement will be held from 2 p.m. on the 22nd to 10 a.m. on the 27th. The tentative agreement will only gain formal status if it passes the vote.

Samsung Electronics labor and management failed to narrow differences during the NLRC post-adjustment held from the 18th to 20th, leading to the collapse of the morning mediation session on that day.

Ultimately, Minister of Employment and Labor Kim Young-hoon directly persuaded labor and management to prevent the strike, leading to the resumption of negotiations at the Gyeonggi Employment and Labor Office in Suwon, Gyeonggi Province, that afternoon.

If the agreement is finally approved after the union’s approval vote, the labor-management conflict at Samsung Electronics, which has continued for over five months since last December, will come to an end.

https://www.chosun.com/english/national-en/2026/05/20/GKUBVOPUVZDQDK5G4S7HEAC3QQ/

SEOUL - A South Korean court granted on May 18 a partial injunction requested by Samsung Electronics ordering the company’s union in the country to ensure its strike does not cut into production volume, a court spokesperson said.

The court also said in the ruling that union action must not lead to the degradation of materials used in the world’s largest memory chip maker’s production, the spokesperson said by telephone.

The union has threatened to go on strike on May 21 demanding greater profit sharing. REUTERS

https://www.straitstimes.com/business/companies-markets/south-korea-court-orders-samsung-union-strike-to-not-impact-chip-volume